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Helpful Tips For Your New Business - « back to Articles
  1. Make all your payments by cheque.

  2. Deposit all your revenues. This will help you in your bookkeeping.

  3. All expense receipts and customer invoices must be retained as proof of purchase. Note the date of payment and check/receipt number, and file invoices along with the packing slip and purchase order. Invoices should be filed alphabetically, chronologically or categorically.

  4. Decide on an accountant and a lawyer as soon as possible. You may notuse these advisors a lot or even immediately, but you should know with whom you would consult in any given situation. If you are starting a partnership or corporation, a lawyer will be needed for any agreements.

  5. Do a monthly Gross Profit Audit. This is an important management tool.Remember to include freight in cost of inventory.

  6. The Worker's Compensation Board should be contacted to find out what responsibilities you have as an employer.

  7. Purchase orders should be used for every purchase. A purchase order should describe the item, the cost, the buying terms, delivery date and the shipping company of your choice. If the supplier fails to comply with any of your terms, you have the legal right to refuse the order or not to pay. The copy of the purchase order must be sent to the supplier. Purchase orders should be extended to show total cost and, if retail operation, total revenue. This exercise will indicate the dollars required to pay for the order and gross profit.

  8. Prepaid shipment means that the supplier has paid the freight and owns themerchandise until it is taken from the truck. The supplier is responsible for any freight damage and must take the appropriate claim.

  9. Most often Collect shipments are the buyer's responsibility and the buyer owns the shipment just as soon as the supplier places the goods on the truck. Therefore, the billing of lading is very important. The weight that is shown and the number of pieces should be checked and verified before signing in the presence of the delivery driver.

  10. Sales should be recorded daily in a sales record. This record should show the sales, the PST and GST. If you use a cash register, the totals of your merchandise sales should be used to compare with last year's totals for the same time period. It is a good idea to record any unusual events which may have caused large differences in sales, or no sales; events such as weather conditions, road closures, elections, etc.

  11. Measure the results of advertising. Records should be kept regarding the date of the ad, the items advertised, where the ad was placed and the number of items sold. If the ad only lists your company name and company service, record the number of telephone calls received or if the sales have improved. This information will assist in indicating the success of your advertising.

  12. Inventory should be counted at regular intervals to record stock on handand the number of items sold. Seasonal items should be ordered on the results of past inventory history. Good inventory control will identify fast sellers and slow movers and lower your investment. Inventory records should be reviewed regularly and decisions made to cancel slow movers and/or adding new items.

  13. Record all costs of the items in stock. Keep this list up to date and consult itbefore you issue purchase orders and at year end to extend the value of yourinventory. It is better to record the value when buying rather than looking upinvoices to figure your closing inventory.

  14. It is standard practice to take the full amount of time allowed on Accounts Payable, unless there is a cash discount. Negotiate suitable credit terms with your suppliers.

  15. Send out invoices and statements promptly to your customers and try to maximize cash sales.

  16. Your suppliers may agree to assist in paying for some advertising you do for theirproducts. Negotiate this point with your suppliers.

  17. Restrict the number keys to the premises that you issue; selecting only trusted staff and emergency response personal.

  18. Calculate a Break even point using daily expenses and your minimum daily revenues.

  19. Use a "To Do List" to help you manage the details.

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